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Todt aiming to reduce cost of engines

NEWS STORY
25/11/2014

Ahead of the latest meeting of the sport's Strategy Group, FIA president Jean Todt says he is determined to bring down the cost of engines.

With Marussia already appearing to have gone to the wall and administrators doing all they can to save Caterham, attention turns to the sport's three smallest teams - Sauber, Force India and Lotus - who recently called on the sport to address the issue of engine costs.

In an open letter, sent ahead of the season finale in Abu Dhabi, Force India deputy principal Bob Fernley wrote: "The costs of the power unit together with the installation costs amount, on average, to $43m. This clearly shows that 70-80 percent of the FOM income has to be allocated to the engine.

“For us, as engine customers, the engine technology, i.e V6 or V8 turbo-charged or hybrid, is of much less significance, as opposed to engine manufacturers, who are using Formula One as a marketing tool to showcase high-end technology.

"Unlike manufacturer-owned teams, our core business is Formula One," he added. "Yet, we have no choice but to spend most of our income on the engine, and the remaining 30 percent is by far not enough to construct, enter and run a team over a 20-race season.

This was followed by stinging attack from Tony Purnell, the FIA's former technical adviser, who criticised the sport's governing body for failing to cap the cost of the new V6 engines.

The price of the engines was due to be limited to £5m in 2010 under plans developed by F1's teams association and the FIA. However, this fell by the wayside when the FIA attempted to introduce a £40m cap on team budgets. It was eventually dropped after eight of the teams threatened to leave the sport though, ironically, it would have kept their wheels turning now.

The cap was the brainchild of Max Mosley and Purnell who says: "We were probably too ambitious. You can do it policy by policy and one policy would be to set the sale price of these new engines. It's a very small move, and people wouldn't really notice it, but it would be hugely important. Without doubt the engine bill used to be one of the biggest headaches for any small team and I'm sure it still is. It's a massive wedge of money. To me it is crystal clear that it is the FIA's job to do it."

Ahead of the meeting of the Strategy Group, Todt said he determined to find a solution.

"I am going to fight about the price of the engines for the small teams," he said, according to Reuters. "I will do the best. I cannot guarantee the result but I will really get into that.

"On engines I think we can find a solution. I am optimistic we will get something," he added

Insisting that sport's priorities are to reduce costs, improve 'the show', make powertrains cheaper for private teams and to ensure all parties remain in the sport, he said: "We are going to re-present to the different stakeholders through the strategy group the same proposals which were refused. But do they want a cost cap? Do they want to follow the proposals we have to reduce the costs?"

Indeed, speaking in Abu Dhabi at the weekend, Christian Horner suggested the introduction of a new engine for 2016, which would surely drive up costs.

"The costs are too high and I think one of the crucial aspects in those costs is the power unit and that's something the strategy group, as well as the other players within Formula One have a duty of care to look at very carefully and I think, whilst probably not a lot can be done for 2015, I think an awful lot can be done for 2016 and maybe we need to even go as far as looking at a different engine, y'know, a new engine," he said. "Maybe still a V6 but maybe a more simplified V6 that controls the cost. Cost of development, cost of supply to a team and to the privateer teams. I think that's something we need to have a serious discussion about during the next strategy group.

"The engines that we have today are incredible bits of machinery," he added, "incredible bits of engineering but the cost to the collective manufacturers has probably been close to a billion euros in developing these engines, and then the burden of costs has been passed on, unfortunately, to the customer teams so unfortunately, I think we have to recognise what's been done from an engineering point of view and now look to simplify things, potentially retaining the V6 philosophy, perhaps going to a twin turbo that would address the sound issues that we've had this year and maybe even a standard energy recovery system would dramatically reduce the costs, dramatically reduce development and therefore the supply price to the customer teams also. So I think that's something that the strategy group need to discuss and look at."

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1. Posted by gturner38, 27/11/2014 15:17

"Graham, we had simple cars and less rules in the 80s and 90s. We also had cars two laps down finishing in the top 6. The racing was not all that close. On top of that aerodynamics have progressed so far that open aero rules would make passing impossible and bring the safety of most tracks into question.

I think the simplest solution for the engine cost issue is a price cap. Keep the cost down for the customers while letting the manufacturers spend what they like on the engines. It's not as if a gun is being put to their heads making them spend the money and WEC has proven that similar systems can be built effectively for far less money. Completely reworking the engine as a twin turbo with a standard ERS system not only doesn't reduce costs, it reduces the usefulness of running hybrids in the first place. The only purpose that idea served was to try to make Red Bull more competitive."

Rating: Positive (1)     Rate comment: Positive | NegativeReport this comment

2. Posted by Spindoctor, 26/11/2014 16:26

"@GrahamG - Quite agree about the ludicrously over-complex and regulated nature of F1.
Personally I'd favour a complete "tabula rasa" re-think, especially of the stupid aero and tyre requirements. The small teams' problems are mainly a consequence of these aspects, as no-matter how much the motors cost, they can at least buy a decent one! There's no way they can afford to spend millions on wind-tunnel time and\or simulations.

The engines are different. Let Mercedes, Ferrari, Renault & Honda compete and deploy their best brains in doing-so."

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3. Posted by GrahamG, 26/11/2014 13:38

"The current engine is a blind alley in terms of racing and cost and not even that exciting in terms of performance - look at the pace of a GP2 car for a (tiny) fraction of the investment. F1 has a simple problem, over regulation. Because of regulation built upon regulation teams have to spend millions on tiny aero changes, adapt cars to numerous different tyres and (as has been said) spend multi millions on engines. Daft ideas like DRS and using different tyres within a race just confuse the spectating public ("why do they want to use tyres which only last 2 laps?") If people want close racing with "best driver wins" then we need much simpler cars, more choice of approach and far fewer regulations. By all means retain turbos - but in a form that is realistic, can any manufacturer really claim that the current massively complex drive trains will ever be translated into road cars for the general public? Of course not, its a vanity programme."

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4. Posted by Spindoctor, 26/11/2014 13:12

"The "powerplants" may have cost 1 billion euros to develop, ( averaging around Euro 340M per manufacturer) but developing anything new always has its costs front-loaded. Assuming that FIA keeps it nerve, and doesn't dick with the rules, these costs will effectively be amortised over several years. Factor-in revenue from selling the motors to other teams (even at a capped <Euro 10M per annum per team) and the net cost isn't that high, in the context of global Advertising budgets.
Looking at the total Corporate spend on Advertising, Promotion, "Brand Awareness", etc.; participation in F1 is, for the likes of Mercedes, Honda, Ferrari, McLaren, Renault & Red Bull a price worthy paying. Additional costs incurred by "subsidising" smaller teams, would be marginal (though still a LOT of money!). They'll all stay "in" as long as the business delivers those Marketing benefits, but therein lies the rub.

Despite Bernie bumping-up CVC's profits by getting a "Rogues Gallery" of despots to back him by paying £50m a year to stage GPs, F1's impact is diminishing. CVC are doing well, but fewer people (of any age!) are choosing to receive the marketing messages of Ferrari et al on their TVs.
That's because despite (or because of?) the glitz & glamour: the spectacle isn't that involving. No "David" is going to slay the Mercedes "Goliath", because at present they can't afford to join the club. Nobody expects Burnley to beat Manchester City, but because they get to be on the pitch with them, there's always a chance.
Despite some brilliant new young, talented drivers, and some excellent racing this season F1 is still in "crisis". If there are no "small" teams how will next year's new drivers get a chance?
"

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5. Posted by CL, 25/11/2014 16:39

"Remove the hybrid element and suddenly Mercedes & Honda are no longer interested. Maybe someone will step up. Ferrari don't produce V6 engines (except twin turbo ones for Maserati) so their interest is low. F1 needs to start selling its achievements better, make itself an attractive thing to watch, increase income for teams from sponsors. Instead it's sitting around shuffling pennies into the pot at a high-stakes poker game. Makes no sense."

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6. Posted by Jonno, 25/11/2014 16:32

"How sensible - not. Todt wants to force the engine manufactures to lose money, so that CVC and Bernie don't have to dig into their massive profits. That's the way forward, that'll get F1 out of the mess caused by Bernie and his secret deals. What will Todt do should Renault and Mercedes tell him to go fly a kit?
"

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7. Posted by slracer, 25/11/2014 16:23

"Can someone present the cost of the engine (ICE) vs the cost of the other 5 "power unit elements"? I'm GUESSING running "real" motors reduces the cost by more than half!"

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